July 25, 2024

Can You Afford a Home? Prices Hit Record Highs in April

April marked a new pinnacle for home prices across the United States, driven by an enduring housing shortage that has kept affordability out of reach for many potential buyers. Despite soaring mortgage rates, the market showed robust price gains, as highlighted by the latest S&P CoreLogic Case-Shiller index report released on Tuesday.

Nationally, home prices rose by 6.3% year-over-year in April, a slight slowdown from the 8.3% increase noted in March. On a month-to-month basis, prices edged up by 0.3%, according to the index.

“For the second consecutive month, our national index has surged past its previous all-time high by at least 1%,” remarked Brian Luke, head of commodities, real and digital assets at S&P DJI, in a statement. “As we move into summer, the market is once again reaching unprecedented levels, testing its resilience during what is typically a more active period.”

The 10-city composite index, which includes major cities such as Los Angeles, Miami, and New York, recorded an annual growth of 8%, a slight dip from the 8.3% increase seen in March. Similarly, the 20-city composite index, covering additional markets like Dallas and Seattle, reported a 7.2% annual gain, marginally down from the previous month’s 7.5%.

Approximately half of the 20 major metropolitan areas tracked by the index experienced price increases.

“Last month’s all-time high saw all 20 markets accelerating in price gains,” noted Luke. “This month, slightly over half of these markets are continuing to see monthly price increases.”

San Diego led the charge with the most significant annual price rise, hitting 10.3%. New York and Chicago followed with gains of 9.4% and 8.7%, respectively.

Factors Behind the Housing Crunch

The ongoing housing affordability crisis stems from several factors. Years of underbuilding have resulted in a severe shortage of homes, a situation worsened by the swift increase in mortgage rates and the high costs of construction materials. The past three years have seen higher mortgage rates creating a “golden handcuff” effect. Homeowners who secured ultra-low mortgage rates of 3% or less during the pandemic are now hesitant to sell, thus further tightening the supply of available homes.

Economists forecast that mortgage rates will stay elevated through 2024, only beginning to decline once the Federal Reserve initiates rate cuts. However, even with potential reductions, rates are unlikely to return to the historically low levels observed during the pandemic.

Regional Variations in Price Growth

Among the cities analyzed, San Diego saw the highest price increase, followed by New York and Chicago. In contrast, Portland, Oregon, posted the smallest gain with home prices rising just 1.7% year-over-year.

The Case-Shiller index, which reports with a two-month lag, may not fully reflect the most current market trends.


As the housing market continues to navigate the challenges of high mortgage rates and limited inventory, home prices are likely to remain elevated. Buyers and sellers alike will need to adapt to this dynamic landscape, with affordability concerns continuing to pose significant hurdles.


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